best time to sell

What to expect for the rest of 2023

by John Rice

In 2-3 months, you will be reading that sales have dropped significantly. The news media will have you believing the sky has fallen. They will compare the stats to the booming pandemic years and/or the best of times……as if that was normal. Headlines will read:

“Sales down 20% (compared to last month.)”

“Mortgage applications fell to lowest level (since 2022.)”

The reality will be that the market has just returned to normal, seasonal cycles.

I think sometimes we forget to look back far enough to see the bigger patterns. It probably doesn’t help that the media people are only following real estate long enough to write their article. It also doesn’t help that so many real estate agents haven’t been in the business long enough to see a balanced or even a bad market.

This is what a balanced market looks like: Some houses sell the first day on the market in multiple offers. Some houses don’t sell quickly and need one or more price reductions. March through August are peak sales months. After August the sales gradually slow down and start picking back up after the New Year.

So, for the rest of 2023, I think we will see fewer and fewer sales. Yes, the interest rates are high and that is what is returning us to a more balanced market. However, that is not the only reason we will see fewer sales. Part of it will be that we have returned to a more normal cycle of sales slowing down due to the time of year. I think prices will remain stable. We will see a whole lot of price reductions on listings that didn’t sell the first day on the market. This doesn’t mean that values are dropping. It just means the seller and/or their realtor were just too ambitious on the list price. We are returning to a market where buyers have some choices. When there are not 10 buyers fighting for ever single house, it means the loser houses that nobody wants will have to reduce the price to even attract one buyer.

When is the best time to sell?

by John Rice

I get asked this often.

If you’re really not into reading, I will go ahead and tell you. The best time to sell is when you are ready to put the house on the market.

Why wait? There are buyers out year round. Always have been. Always will be.

There are a few things to consider though.

The goal in any market is to get as many buyers as possible wanting your house. You do that by pricing it correctly and presenting it well. Usually the first few days on the market is your best shot of getting multiple offers. Once a listing grows stale, buyers are not afraid of losing it. They will pay top dollar for it if they are afraid somebody else will get it first. So, that means the first few days are the most critical to get right. Again, always has been. Always will be. That is why most realtors put their listings on the market on a Friday. Most people are off work on the weekend which means more showings. If your first weekend on the market is going to be a big UK home game, a big day for Keeneland, Mother’s Day or some other holiday when people will be traveling or have events with family/friends, it might be best to wait a week.

With so few houses for sale any more, you don’t have to worry as much about competing listings. I don’t worry about what time of the year is best and you shouldn’t either. If we ever get back to having a lot of inventory, my advice might change. Right now, any time is the best time.

What to do when you’ve gotta sell your old house first

by John Rice

I feel for people in this situation. I mean, the market is so tough right now. Even buyers who do NOT have to sell their old house before buying their next one are struggling to be competitive in multiple offers.

The odds of you finding a seller who will work with you when they have other offers without a similar contingency are equal to winning the lottery. Hoping for the best isn’t realistic. Here are some not so fun options that will ultimately end up with you getting your next home.

  1. List your house. Sell it. Pack up. Move out. Rent or stay somewhere short term until the house you want hits the market. Then buy it. This gets you where you wanted to be, the only negative is that you will end up moving twice.
  2. List your house. Sell it. Only take offers from buyers who will let you rent back after the closing. Then begin your search and only move once. Most buyers will give you maaaaybe 30-60 days after closing before they will want to be able to move into their new home. This allows you to buy something but you’re under pressure to find and close one within that time period. If you can’t, you’ll have to move out and stay somewhere short term.
  3. Only look at houses that have been on the market for more than about a week. Often these are the less desirable homes since the rush of buyers who saw it when it was a hot new listing decided they didn’t want it. The beauty of this plan is that you only move once and likely are not competing at all with other buyers. This is a good thing. A seller who only has one offer is much more likely to accept a contingency offer than one who has better choices.

So there you go. None of these are exciting. All are a lot of work. But they are real solutions to today’s real estate issues.

Want the lowest price you’ll see in 2023?

by John Rice

I have always said that late winter and early spring are the best times to buy a house if you’re worried about prices.

Why? Very simple.

Regardless of the temperature of the market, you are still buying at last years prices. We never know what the market will be like until the Spring buying season begins. Once the market pops for the year, prices begin to go up. The past few years they really went up.

While I don’t see this year having the same crazy appreciation, there are enough signs that prices WILL go up:

  1. There will be fewer houses for sale since most people bought or refinanced when rates were very low. We are back to people moving because they need to instread of just wanting an upgrade.
  2. Rates are stabilizing and projected to go down a little more. Every time recently that rates have gotten to about 6%, buyer activity really picks up.
  3. Aaaaaaaaand the obvious is inflation is causing the prices of everything to go up!

By the time all the leaves are on the trees, anybody who plans on buying a house will be out there submitting their highest and best offer. Your best chance to get the lowest price for the year is to get out there now. The house you can buy today WILL be worth more by the end of 2023.

Know what I like about this market?

by John Rice

If you just want the answer but don’t care to know why, it is because this market is LOGICAL.

If you want to know what I mean, here we go:

Other than the past few years, the real estate market has always been logical. The best houses sold for the most money and sold the quickest within their price range. The second choice houses sold for less than the more desirable houses. Location mattered. The lot the house was on mattered.

For a few years there, nothing mattered. Any house was selling for more than it should have and it didn’t matter if one house was in a second choice neighborhood or had a terrible lot. It was tough being a realtor back then. You could look at recently sold comparable homes and determine what a house should be worth, but it always sold for more, sometimes waaaaaay more than that. I would tell my sellers “Here is what your house is really worth but here is what it could sell for…..expect anything to happen!” I would tell my buyers “Here is what the house you are bidding on is worth, but here is how much of a convenience fee you may have to pay just to end your misery of losing in multiple offers.”

Today’s market is about logic again and I am glad. If two identical houses come on the market on the same street and on the same day and one of them backs to the interstate and the other doesn’t, the one with the better lot will sell for more. If a house is overpriced, it won’t sell at all.

Why is this? It is because today’s buyer has choices. Yesterday’s buyer had one shot at the only active listing in their price range. Having a little inventory makes a difference. It is still a good market. It is an even better market if you have one of the better houses in your price range. This has always been true. I remember back in 2009. The market sucked yet I was getting multiple offers the first day on the market for some of my listings. Buyers will always pick the very best house that is available and take a pass on those that aren’t. That’s just the way logic works.